Changing the name of a company can change its investors' fortunes, as shown by a note shared by the portfolio management service Aequitas Investments.
The PMS, which has Rs 4,000 crore worth AUM, shared a note on 94 listed companies that changed their names to accommodate the latest trend in the market. Their stocks made a 124 percent average annualised return in 2023!
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In their note titled "The Madness of Markets-New New, New Me?", the PMS shared the names of a few stocks that profited by creating a new identity by latching on to the latest buzzwords such as defence, EV, Renewables, AI Tech.
Here are the top five in terms of returns since the name change announcement: Mercury Metals, now known as Mercury EV-Tech, with 754.9 percent; Titagarh Wagons now Titagarh Rail System with 230.6 percent; Sundaram Clayton now TVS Holdings with 200.2 percent; Shradha Industries now Shradha Ai Technologies with 185.1 percent; and Amara Raja Batteries now Amara Raja Energy & Mobility with 181.1 percent.
The most interesting case, which merited a more elaborate entry, was of BSEL Algo AI.
As the PMS's note observed, the company has already changed its name twice to align with the latest buzzwords. In the IT boom of 1998, it renamed itself BSEL Information Systems from Bell South Enterprises; and at the height of the realty boom in 2003, it renamed itself BSEL Infrastructure Realty.
Recently, as the AI boom unfolded, it changed its name to the present BSEL Algo AI.
"Would this be the last time," the note asked.
On October 18, Helios Capital's Founder Samir Arora tweeted about a tile-maker company changing its name to include AI.
He posted, "We finally have an Artificial Intelligence company in India. You can also buy tiles and marbles from the same company."
This was about Dhyaani Tile and Marblez, which had informed the exchanges that its Board had approved changing the name of the company to Dhyaanii Artificial Intelligence Ltd or Dhyyaani Artificial Intelligence Ltd.
The phenomenon of changing names is not a new one.
Aequitas's note said that, in the dot com boom, 183 companies added ".com" to their names and their share prices shot up by 74 percent on average. It added, "Post the bust, 67 Cos. (companies) shed ".com" from their names to distance themselves from the crash." The stock prices dropped by 42 percent on average.
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In 2008, 106 Indian listed companies changed their names to include the then buzzwords of realty and infrastructure. For example, Anna Finance became Anna Infrastructure, Anmol Trading Co became Shaily Engineering Plastics, and Genus Overseas became Genus Power Infrastructure.
In 2016, Bharati Shipyard was renamed Bharati Defence and Infra and the stock gained 25 percent. Vakharia Power Infra became IND Renewable Energy, and Hydro S&S Industries became Kingfa Science & Technology, said the note.
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